I take a conservative, evangelical, economistical look at things. I will be posting intermittently, for reference rather than daily reading.
My Wordpress site from before 30 September 2007 is at http://rasmusen.org/x. It is searched from the search engine below(not above).

Saturday, February 14, 2009

Me on the Stimulus

It might be convenient to collect things I've said about the stimulus bill that aren't on this blog. For Newmajority.com:

What the American economy urgently needs is not Keynesian stimulus, but reform of the capital and housing markets, particularly in the rating agencies, bank portfolios, and government encouragement of reckless lending. That is where the problem started, and where it might have remained-- with the mild recession of the first half of 2008-- if Presidents Bush and Obama had reassured the American public rather than predicting doom. Whether Keynesian stimulus works is an open question in economics, but it is fairly well settled that what governments implement is not the nonpolitical stimulus that professors recommend. The various Congressional proposals so far are not stimulus bills at all. They are a mix of special- interest tax cuts and pork barrel spending with a general-interest layer of tax cutting on top. It would be better not to try to use fiscal stimulus at all.

Eric Rasmussen, a free market economist at Indiana University’s Kelley School of Business warns that the money could fund economically inefficient projects.

“They tend to be projects which wouldn’t get through in normal times because they wouldn’t pass the cost benefit analysis,” he said. “It’s much more prey to special interests then something like a tax cut.”

I should remember to spell out my name for people. And to ask how they heard of me. Since she calls me "a free market economists", it's probably from the Cato ad.

Selected Archive Topics >

I've set up this blog for myself, as a commonplace book, with the idea that it might
also be useful for outside readers. That is why the topics are idiosyncratic. I see that most of my readers are directed here
by Google searching rather than being regular readers.

I will delete rude comments, and will give less leeway to anonymous comments than to signed ones. I will for now at least
allow stupid and ill-informed comments, though other readers don't enjoy them unless they are so ignorant as to be funny.

I will revise my posts freely, usually without any note that they've been revised. If I make an important mistake in a post that I think
people might refer to, I will note the mistake and correction. But I'm not trying to make this a historical record. In fact, I'd like to merge posts on the same topic
and delete posts not of interest a year later, except that I never get round to doing that.